Treasuries rise as US stocks recover and AI risks persist

US stocks recovered on October 15 as the S&P 500 rose 0.3%, ending a three-session decline while broader gains outpaced tech.

The equal-weighted S&P 500 gained 1.4%, compared with the main benchmark’s smaller advance, while the Nasdaq 100 finished approximately unchanged. The Dow Jones Industrial Average added 1.1%, putting it ahead of the technology-heavy Nasdaq measure.

The differing returns put the distribution of gains at the center of the recovery. An equal-weighted index gives each constituent the same allocation, rather than allowing the largest companies by market value to exert the greatest influence.

CoreWeave puts AI financing in focus

Chip shares stabilized after Jensen Huang, Nvidia Corp.’s chief, expressed support for CoreWeave Inc.’s financial position. CoreWeave buys Nvidia equipment, and Nvidia holds an investment in the computing provider, giving Huang’s comments the perspective of both a supplier and an investor.

The episode highlighted a distinction between demand for artificial intelligence and the economics of supplying it. Manish Singh of Crossbridge Capital said demand remained real, but that did not guarantee attractive investment returns for every business constructing the infrastructure.

Singh argued that eventual cash generation must support the money committed today, with financing needed until those revenues arrive. His assessment separates the adoption of AI tools from the profitability of the companies providing their computing capacity.

David Morrison of Trade Nation identified higher financing costs as a disadvantage for an infrastructure expansion supported by borrowing. That makes the interest-rate environment relevant to the sector’s funding requirements, not simply to stock-market valuations.

Treasuries gain before Warsh remarks

The benchmark US Treasury yield fell 10 basis points to 5.09%, alongside rising bond prices. German and British 10-year government yields each declined five basis points, reaching 3.41% and 5.37%, respectively.

Krishna Guha of Evercore identified Federal Reserve Chair Kevin Warsh’s forthcoming remarks as a test of whether officials were considering an October rate increase following the latest inflation figures. Guha’s assessment favored comments that would not point toward an increase that month.

Guha said weakness across technology shares, tighter financing for more exposed AI businesses and the earlier rise in longer-term yields would inform Warsh’s assessment. Warsh was scheduled to speak in Bangkok with IMF Managing Director Kristalina Georgieva late Thursday, New York time.

AI returns face two financing paths

Under a scenario in which borrowing costs ease and AI revenue supports investment commitments, financing pressure on infrastructure providers such as CoreWeave could lessen. For the wider industry, that would improve the conditions for funding computing capacity; across markets, easier financing could support investment beyond technology.

If inflation instead prompts higher rates, Morrison’s financing concern would become more pressing for debt-funded projects. CoreWeave’s funding requirements and those of its peers would warrant closer scrutiny, while higher financing costs could also constrain investment elsewhere in the economy.

The distinction is between a daily recovery in asset prices and evidence that infrastructure spending can produce adequate returns. Warsh’s policy signals and AI providers’ ability to demonstrate cash generation remain separate tests; Thursday’s equity gains alone do not settle either.